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43. Moreover, it is submitted that even if it is assumed that the respondent Bank has a lien on the terminal benefits payable to the employee, it loses its possessory lien once the money is disbursed to the employee. To support the said averment, Mr. Harshvardhan relied upon the judgment in the case of United Bank of India vs. Bidyut Baran Halder & Ors., 2018 SCC OnLine Cal. Therefore, having credited the petitioner‟s terminal benefits, the respondent Bank could not have unilaterally adjusted the same against his outstanding loans.

44. In view of the judgments stated in the paragraphs above, it is submitted by Mr. Harshvardhan that the respondent Bank had no right to mark lien on the gratuity amount of the petitioner, especially when the said amount had already been credited to the petitioner‟s account Neutral Citation Number:2023/DHC/000055 by the respondents in his pension account and maintained with the Bank‟s Malviya Nagar Branch. In this regard, he relied upon the judgment in the case of Bidyut Baran Halder (supra), wherein the Calcutta High Court has held that even assuming that the bank has a lien on the terminal benefits payable, it loses such lien once the money is put in the account of the employee, and the same is exactly the scenario in the present petition.

45. Mr. Harshvardhan has controverted the stand of the respondent Bank that as per Section 171 of the Indian Contract Act, 1872, ("Contract Act" hereinafter) the respondent Bank has a lien over all the monies lying with it and therefore, it has the power to appropriate terminal benefits against the petitioner‟s outstanding loans. In support of the said averment, the learned counsel for the respondents has relied upon the judgment of the Supreme Court in the case of Syndicate Bank vs. Vijay Kumar, (1992) 2 SCC 330. Mr. Harshvardhan stated that the said judgment has no application to the facts of the present case, as in that case, the judgment-debtor who owned two Fixed Deposits (FDs), had executed two letters creating a lien in favour of the bank over the said Fixed Deposits Receipts (for short, „FDRs‟) and in that background, the Supreme Court held that the two letters executed by the judgment-debtor created a lien in favour of the bank over the two FDRs.

125. I may at this stage state that it is the settled position of law, once the gratuity and leave encashment has been disbursed to the employee, the amount losses the character of gratuity amount/leave encashment. Reference in this regard is made to the judgment of Calcutta High Court, in Bidyut Baran Halder (supra) wherein the following has been stated:

"37. Even assuming that the Bank had a lien on the gratuity amount payable to Bidyut, in our opinion, the Bank lost such loan once the money was put in the account of Bidyut albeit a frozen account. It is elementary law that a banker's possessory lien is lost once it gives up possession. This Court has held in several cases that except under Sec. 4(6) of the 1972 Act, no deduction can be made from the amount of gratuity payable to an employee under the provisions of the said Act. In this connection reference may be had to the cases in Ram Ranjan Mukherjee v. Mining and Allied Machinery Corporation Ltd. (supra) and Eastern Coalfields Limited v. Kripa Sankar Somany (supra). In Radhey Shyam Gupta v. Punjab National Bank (supra), the Apex Court held that retiral benefits such as pension and gratuity even when received by the retiree, do not lose their character and continue to be covered by proviso (g) to Sec. 60 (1) of the CPC and continue to enjoy immunity against attachment. In State of Jharkhand v. Jitendra Kumar Srivastava (supra), the Apex Court reiterated that gratuity and pension are not bounties. An employee earns these benefits by dint of his long, continuous and faithful service. It is hard earned benefit which accrues to an employee and is in the nature of „property‟. Such right to property cannot be taken Neutral Citation Number:2023/DHC/000055 away without due process of law as per the provisions of Article 300A of the Constitution of India. It was held that the attempt of the appellant State Government to take away a part of pension or gratuity or even leave encashment without any statutory provision could not be countenanced. In the unreported judgment of a Division Bench of the Kerala High Court in WA 1628 of 2014 in WP (C) 923 of 2014 the employer Bank sought to adjust alleged dues from the deceased employee against the gratuity payable to his legal heirs. The Division Bench upheld the learned Single Judge's order striking down such action on the part of the Bank holding that the gratuity due to an employee could not be withheld except under Sec. 4(6) of the 1972 Act. The Bank had also argued that it had a right of lien under Sec. 171 of the Contract Act. The Division Bench held that the amounts claimed by the legal heirs of the deceased employee were the terminal benefits that were due to the deceased employee and the same could not be retained by taking recourse to the lien of the Bank and in any event, having regard to Sec. 14 of the Payment of Gratuity Act which gives it overriding effect, such right of lien could not be exercised by the Bank in respect of the gratuity amount."